The True Cost of Telco Damages

BY SCOTT LANDES

Communications companies always recover all their costs when their cables are damaged by contractors. If you believe this, I have some bad news… there is no Santa Claus and no Easter Bunny! Communications companies seldom recover anywhere near all of their true costs.

When talking to communications stakeholders who have firsthand experience with damage investigation, claims recovery, and field operations, they all recognize that even if they recover all the actual repair costs, it is still only a fraction of the true costs. When the hard costs are combined with the soft costs, only 40-50% is usually recovered – even when the contractor or locator is 100% at fault. And keep in mind, many times it is neither the locator nor the contractor’s fault.

A seasoned telecommunications professional reviewed the checklist on page 21 for accuracy and responded to me, “It does look like a comprehensive approach but to truly do it justice, you would have to put this in book form. It is sad that things in the corporate world have gotten so busy that no one can really get their head around the scope and effect of damages. To merely provide this list without description should be enough to make anyone sit up and pay attention. Equally so, even those of us who deal with this on a daily basis, although cognizant of the facts, cannot consider all the ramifications when dealing with damages. This is where the corporate world needs to come into play. Just like the repair technician should be concentrating on restoral, and the investigator concentrating on determination of liability and building a solid case, upper management should be aware of and considering all the mitigating factors listed, and the effect not just on the customer, but also on the company as a whole.”

On top of all these costs which have and will continue to impact the facility owner’s bottom line, there are significant societal costs, including lost revenue for businesses, road closures during repairs, people sent home from work due to phone/data services cut off, the severe impact to 911 call centres, and the interruption of services from police, fire, ambulance and other emergency responders which could lead to a loss of life when communications are terminated during a time of crisis.

ln Canada, the CCGA DIRT report estimated in their last national report on damages that societal costs of damages are $1 billion. The 2016 Common Ground Alliance annual DIRT report (CommonGroundAIIiance.com) estimates the U.S. societal costs at over $1 billion.

As you read through this checklist on the costs of a cable cut provided by telecommunications professionals, ask yourself:

  1. What percent of hard costs and soft costs do I actually collect?
  2. How do damages affect my brand?

Consider this:

LOST CUSTOMERS: Weather-related loss of service is often acceptable by customers, but loss of service due to non-weather-related issues can lead to the depletion of your customer base, and this cost is not tracked as a cost of damage.

CUSTOMER REBATES/CREDITS: Usually when a customer asks for credit, they get it. This can be expensive. Many customers have Service level Agreements (SLAs) which provide rebates to the customer if service levels are not met; some rebates start the first minute of down time. This cost is not included in the cost of damage.

EMPLOYEE LABOUR COSTS: While these costs may be included as part of the labour charges, the hourly rate may not be the loaded labour rate. Post-restoration time spent on building damage claims is never included in the cost of damage or collected.

REPAIR TECHNICIAN MOBILIZATION: When technicians are pulled away from their regular load to restore damage, overtime is incurred and customer dissatisfaction is created due to deferred repair and installation loads originally scheduled for the day.

ENGINEERING OR REENGINEERING COSTS: There is a reduction in productivity when an engineer is pulled from his work to do emergency design for repairs.

UPDATING RECORDS: A hidden cost associated with damages that is usually removed from a challenged bill as an administrative cost.

LOCATOR EMERGENCY MOBILIZATION: Emergency tickets can be devastating to the locator – rerouting, additional execution time to perform the locate, and the delays to other excavators waiting for locates to perform their work.

MOBILIZATION OF DISPATCH SUPPORT, MONITORING, AND VERIFICATION OF REPAIRS: Again, considered administrative, this is another potentially astronomical cost that is often not even considered.

As a whole, the telecommunications industry is not engaged in damage prevention. Immersed in damage prevention myself since the early ’80s, it has always amazed me how many telecommunications companies do not have damage prevention programs or participate in the Common Ground Alliance. The most common rationale is that it isn’t necessary as they successfully collect the costs of damages. As you can see here, this is not accurate.

Investing in damage prevention improves your bottom line and keeps your workforce continuously focused on proactive work, improves your image and enhances your customer service. If your priorities are profits, productive employees, and happy customers, making damage prevention a high priority is an easy choice.

The TRUE Cost of Telco Damages

The cost of cut or damaged communications cable can easily be underestimated when only repair costs are tracked and documented.

Improve your understanding of the real costs of damages with this checklist based on insight from experienced professionals who have spent years working for communications companies.

What percent of hard and soft costs does your company collect?  How do damages affect your brand?

Trackable Costs ________________                                                 

May or May Not Be Collected

  • External Collection Costs/Agency Commissions
  • Barricades/Traffic Control
  • Permits (city/county/state/provincial) to install replacement cables
  • Legal fees and litigation costs
  • Exposing the damage for repair
  • Materials used in repair
  • Restoration of the area
  • Actual cost of internal labour
  • Heavy Equipment used
  • Generator/Power Equipment
  • Food, lodging, travel expense
  • Emergency mobilization (Contractor/Locator)

Soft Costs

  • Loss of brand confidence, negative public feedback, difficulty maintaining customer relationships, especially large businesses, with inconsistent services

Societal Costs

  • Loss of 911/emergency services
  • Businesses closing
  • Employee down time
  • Road closures/traffic delays

Time

  • Damage site investigator
  • Collection efforts
  • Out-of-service complaints
  • lnsurance resolution discussions
  • Overtime for unexpected increases in workloads
  • Employee time/travel for deposition and trial

Overlooked/Difficult to Track

  • Lost Customers
  • Customer loss of use (refunds/credits)
  • Resolution of customer complaints
  • Engineering/reengineering due to the cut
  • Establishing outage bridge to coordinate service interruption
  • Support staff (3-20) for outage bridge
  • Workload delays
  • Future failure points (damages may weaken the system and lead to future failure unattributed to 3rd parties)
  • Damage data capture and submission (software and /or manual)
  • Emergency One Call ticket notifications
  • Facility owner records updates

Reporting requirements (FAA, 911, PHMSA)


Simplifying the sketching tool

Our recently optimized sketching tool will help you better define your work site.

Please note that minor improvements have been made:

  • The name of the “Work Line” tool has been changed to “Fence”. This tool should only be used when you are installing fence posts;
  • You may now preview the work area while creating the sketch;
  • Editing your sketch is still possible even if it is completed;
    • Select the hand, and then click on the shape to modify
    • You can modify the corners and/or the sides of the shape
  • The small white square used to define the limits of the locating sketch is now blue.

These improvements will greatly simplify your work.

If you’re having trouble with your browser, please click here to find out what steps to take.


Update to the Web Portal URL

Due to a security update, we’ve recently had to change the URL giving you access to our Web Portal. Please note that the old Web portal URL is no longer functional as of this moment. Please replace the link in your favorites with the following links:

Thank you for your collaboration.


Locate Request Improvements for Very Large Excavation Zones

Great news! An important modification will be in effect on September 24th and will greatly facilitate your work. Indeed, as of September 24th, you will be able to draw sketches in a row. This will enable you to cover the whole area of your work zone when it extends further than what is displayed on the map.

This modification will result in:

• Viewing the adjacent sketches for your entire work zone when you create the request;
• Automatically creating a locate request for each of the sketches;
• Sending a confirmation for each locate request created.

There are many benefits to this major modification:

• Improves the efficiency of your activities;
• Heightens the accuracy of each locate request, leading to a quicker answer from our members;
• Provides the possibility of receiving a clearance notice for some section of the work zone;
• Simplifies the creation and management of locate requests for large excavation zones.

Click here where you can view a short video demonstrating what steps must be followed to take advantage of this change.

(For the province Quebec only) If you haven’t done so already, we encourage you to read our emails sent on August 24th and 31st where we mention the importance of writing the scheduled start and end dates as accurately as possible.


Details as to scheduled excavation start and end dates (only for the province of Quebec)

We would like to remind you that yesterday, a modification related to the locate request validation period was in effect. This modification will greatly benefit your operations:

  • You may receive, during the course of your validation period, notifications indicating that there were changes to the initial answer. Sent by email, these notifications indicate that underground infrastructures were added within the worksite specified in your request.
  • A notification will be sent 7 days prior to the expiration date of the validation period of your request, giving you enough time to renew it and complete your excavation work.

Remember that writing the start and end date as accurately as possible will have the following effect:

  • Decrease the number of revalidation;
  • Reduce the time spent managing your emails, which includes answers received from owners of underground infrastructures;
  • Lessen the number of follow-ups and your administrative workload.

It should be noted that the period between the excavation start date and its scheduled end date written on your request represents the period in which your request is in effect, thus valid.

Writing irrelevant dates means that everyone involved in the process, Info-Excavation employees and members of underground infrastructures as well, won’t be able to offer the same level of service that you have come to expect.

Visit our tutorials section to learn more about how to make a request and a revalidation.


Participate in the CPWA Infrastructure Investment Survey

As the ‘the voice of public works in Canada’ and to better represent CPWA member interests as the CPWA Board continues to engage with the Government of Canada, CPWA is soliciting information from municipalities about infrastructure investments and their experience with federal programs. This input will inform the discussion when the CPWA Board of Directors meets later this month with Marc Miller, Parliamentary Secretary to the Minister of Infrastructure and Communities. Survey responses may also help inform CPWA’s public policy priorities and future engagement with Infrastructure Canada.

Participate in the survey.


Government working with Canadian Common Ground Alliance to protect federal underground infrastructure

News release

From: Public Services and Procurement Canada

June 21, 2018 – Gatineau, Quebec – Government of Canada

The Government of Canada is committed to maintaining the highest standards of safety for construction workers, Canadians and our federal public infrastructure.

Today, Steven MacKinnon, Parliamentary Secretary to the Minister of Public Services and Procurement, on behalf of the Honourable Carla Qualtrough, Minister of Public Services and Procurement, announced the signature of a memorandum of understanding between Public Services and Procurement Canada (PSPC) and the Canadian Common Ground Alliance (CCGA) to improve the protection of underground infrastructure, such as cables and pipes, located on federal lands.

Building on the important work of the Honourable Grant Mitchell, Senator for Alberta, and Lloyd Longfield, Member of Parliament for Guelph, to raise awareness of the protection of underground infrastructure, PSPC, together with the CCGA, will launch a pilot project to improve and coordinate current notification processes for work on federal lands. This will further strengthen existing processes and prevent damage to underground infrastructure. It will also ensure safety for the public and workers, and improve the safety of federally regulated underground infrastructure.

PSPC will be working with the CCGA and other government departments and agencies within the public service to facilitate a government-wide approach.

Quotes

“Our government is proud to work with the Canadian Common Ground Alliance to reinforce measures that will further ensure the safety of construction workers and Canadians while protecting the federal underground infrastructure.”

Steven MacKinnon
Parliamentary Secretary to the Minister of Public Services and Procurement

Quick facts

  • Underground infrastructure generally refers to a cable, line, pipe, conduit or structure used to gather, store or convey products or services beneath the ground surface or submerged, including where exposed by temporary excavation.

Associated links


SPECIAL COMMUNICATION

Simplified Sketches

Since May 1, 2018, substantial changes to the creation process of sketches are in effect:

• Only the sketch is used to analyze your request;
• A second intersection is no longer needed;
• The possibility to zoom is restricted;
• The map cannot be moved once you have started the sketch.

Benefits and impacts from changes

These changes:

• Improve the accuracy of the sketches;
• Increase the clearance notice rate. Since May 1, 2018, there is a 14% increase. This reduces the number of answers received from owners of underground infrastructures;
• Eliminate automatic segmentation of many requests for the same section.

However, this has an impact on 30% of requests, namely an increase in the number of sketches for the same project.

Upcoming Solutions

These improvements are meant as an answer to the lack of accuracy observed in sketches. Also, distances were sometimes too long, thus harming the quality of requests. This, in turn, increases the risk of damages to underground infrastructures.

We realize these modifications affect some of your projects. We’re already working with our suppliers to find solutions to improve this process. We will keep you informed of the latest progress made.

If you have any questions or concerns, please send us an email at [email protected].


Improvements to the request processing center

Current Modifications

Enhancements in the Request Confirmation form

For some time now, the request confirmation form received by email has undergone some enhancements. As of today, your Google sketch will prevail and attest to the authenticity of the locate request. The area defined in your Google sketch will be the one that will be used.

Consult modifications

 

New to Types of Work

A new type of work has been added. You can now select “Crane Installation”.

 

 

 

 

 

Faster Engineering Request

Great news! Owner members of underground infrastructures have agreed to reduce the turnaround time for an engineering request. It will soon be reduced from 10 to 5 business days.

 

Simplified Sketch

Since May 1st, a substantial change to the creation process of sketches has taken place. Indeed, it is no longer necessary to enter a second intersection. This improvement marks the end of automatic segmentation, responsible for creating additional locate requests.

As far as other modifications are concerned, the use of the zoom and arrows to navigate within the map and move it has been restricted, enabling the clear identification of the worksite. The added benefit translates into an increased number of clearance notices and a reduced number of replies received from owners of underground infrastructures.


Modifications to the Request Confirmation

As of March 4, 2018, modifications were made to our confirmation form, the one received after making a locate request. A warning note regarding the accuracy of your scaled diagram has now been placed on the right-hand side of your diagram. Furthermore, the artwork pertaining to the warning note has also been modified to enhance its readability.

*Important: As of today, only your scaled diagram will be used by our members to determine if their underground infrastructure is located or not within your work zone. Intersections and addresses will only be used to help guide you on our Google Map*.

Previous request confirmation                                              New request confimation

20180131104609nouvelle confirmation de demande